Chinese President Xi Jinping?s visit to India presented a historic opportunity to rebalance Sino-Indian relations?by putting security and economics on more equal footing.
Xi?s landmark visit starting in Gujarat signalled that China?s honeymoon with Prime Minister Narendra Modi continues. China and India signed a Memorandum of Understanding on Cooperation on Industrial Parks in June 2014, which will facilitate $7 billion investment in industrial parks in
Maharashtra and Gujarat.
Xi?s visit came on the heels of Modi?s successful Japan visit, and right before his visit to the United States is scheduled; this should convey that India?s diplomatic plate is full, not inclining ?east? or ?west?. Taking a pragmatic cue, it appears Modi is ?walking on two legs??national security adviser Ajit Doval and external affairs minister Sushma Swaraj have signaled that India will chart out ?Hindi-Chini Bhai-Bhai? bonhomie that envisions economic cooperation and security interests in parallel.
Unlike the Americans, the Chinese have long cultivated Modi?s interest in their country. Thus, China is, expectedly, waiting to reap diplomatic and economic dividends. As Sino-Indian relations move forward, bilateral trade has grown from $200 million in 1990 to $65 billion in 2013-2014 (albeit the wide $35 billion trade deficit in favour of China will need some redressing).
Understandably, the investment in industrial parks and bullet trains has led to euphoria in India. While these make for ebullient sound bytes, there is need for some caution. In the past, China?s speedy execution of projects has led to unanticipated accidents, including the high-profile bullet train accident in Wenzhou in 2012. Industrial Parks in China have led to a host of problems?such as the high-profile case of pollution of Lake Taihu (Jiangsu province) which led to the large-scale death of aquatic life, including fish. Singapore famously burnt its fingers in a $30 billion inter-government project, building the ?China-Singapore Suzhou Industrial Park? (1994) in the eastern city of Suzhou on outskirts of Shanghai. Singapore?s agreement with the Beijing gave provincial officials of Jiangsu little incentive to implement it. Moreover, there was a gap in the business culture and etiquette, resulting in Singapore reducing its share in the venture in 2001, from 65% to 35%. The haplessness of the Sino-Singapore Tianjin eco-city project (2007) in Tianjin-Binhai New Area (TBNA) is another case in point. Once touted as the ?national experimental zone for comprehensive reforms?, administrative conflict has scuttled TBNA?s promise. Both have big lessons that India and China need to learn from.
But scholars on both sides of the border are upbeat. According to Hu Shisheng, deputy director of China Institute of Contemporary International Relations (CICIR), a government think-tank, Xi?s visit provides an opportunity to fine-tune economic interactions ?focusing on commonalities, jointly pushing initiatives such as the BCIM economic corridor (Bangladesh, China, India, Myanmar), progress of the RCEP (Regional Comprehensive Economic Partnership) and making the Brics initiative more functional?.
On the economic front, the BCIM economic corridor will link Kunming (south-west China) with Kolkata (West Bengal), passing through Dhaka (Bangladesh) and Mandalay (Myanmar). Negotiations on projects and financial modalities are being worked out. This will also provide linkages in northeastern India, a region whose economic development is critical.
Leaders of Brics nations recently announced the creation of the New Development Bank (NDB), which Nobel-winning economist Joseph Stiglitz terms a positive step that could bring about a fundamental change in global economic and political power. Both China and India will be keen to ensure that after the photo-op moment in Fortaleza, Brazil, (at Brics summit), the $50-billion NDB kicks off with force. While China has wrested the NDB headquarters, at Shanghai, India has wrested the first presidency.
On security issues, India has much to learn from China. China has belled national interest without compromising on the pace and direction of economic reforms. It has chased the ?one-China? policy and famously succeeded in enshrining it in the ?Shanghai Communiqu?? with the US in the 1970s. China also succeeded in Hong Kong?s return from UK dominion in 1997 and successfully incorporated ?one country, two systems? into its political lingo.
China steered India from the Nehruvian ?suzerainty over Tibet? to recognition of Tibet as an integral part of China. It is, thus, interesting to see India belatedly tying its recognition of the one-China policy to the demand for a reciprocal recognition by China of a ?one-India? policy (Arunachal Pradesh and Kashmir as an integral part of India), a move that is more muscular than anything India has attempted in a decade. Thus, the visit has granted India a golden opportunity to back its one-India policy by getting its own house in order?speedier implementation of infrastructure projects and connectivity in the North East, modernisation of security posts and enabling the new XVII mountain strike corps currently headquartered in Panagarh, West Bengal.
As Modi, a known China aficionado, rolled out the red carpet, he would know of China?s reformer Deng Xiaoping ? Deng, on his first trip to United States hit the Texas rodeo in a cowboy hat ? but followed through a ?quid pro quo? policy that signaled a fundamental break and sea-change in China?s thinking. Prime Minister Modi will no doubt be planning how to maneuver and tango with the dragon.
The author is a Singapore-based sinologist and adjunct fellow, Institute of Chinese Studies, New Delhi